Morgan Stanley found no issues in the results, which were in line with guidance. With a bid on the table, the broker suggests the downside risk is limited. Given the current upside potential to the bid price and competition, the broker maintains an Overweight rating.
The broker lowers FY19-20 estimates for net profit by -2-3%, largely because of the change in accounting policy. Morgan Stanley believes the stock is unlikely to trade around fundamentals in the short term as the opportunity for consolidation is compelling.
McMillan Shakespeare ((MMS)) has submitted an offer that is recommended by the EclipX board. Target is $3.00. Industry view is In-Line.
Sector: Diversified Financials.
Target price is $3.00.Current Price is $2.58. Difference: $0.42 – (brackets indicate current price is over target). If ECX meets the Morgan Stanley target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).